continues to face downward pressure due to uncertainties stemming from tensions in the Middle East. These uncertainties revolve around the future of the Middle East conflict and the impact of the ongoing output cuts enforced by OPEC. OPEC and the IEA have lowered their global growth forecasts 2024, further affecting the oil market. These global pressures include geopolitical tensions, economic uncertainties, and central bank policies impacting energy and currency markets. The uncertainty in the oil market has also impacted natural gas (NG) prices, which remain under pressure.
The escalation of the Middle East crisis on a global scale has also impacted the US dollar index (DXY), along with a basket of major currencies. The US dollar has strengthened as a safe-haven currency. The increased demand for the dollar has placed upward pressure on the US dollar index, making it more expensive than other currencies.
WTI crude oil continues to trade downward after breaking below the 50 SMA. Following a drop from the 200 SMA and a subsequent break below the 50 SMA, the price action suggests that prices will likely remain weak. The 50 SMA has crossed below the 200 SMA, signaling potential bearish momentum. Additionally, the RSI has dropped below the midline, further indicating bearish pressure in the oil market.
The 4-hour chart for WTI crude oil also indicates bearish pressure. This is evident as the price trades below the ascending channel’s midpoint. It has also broken below the black trendline. Strong support for WTI crude is found at $67.30. However, RSI has entered the oversold region. Therefore, the price is likely to rebound from current levels.